While their parents and grandparents derived status from brand names, these shoppers prefer to spend on food, technology, and vacations, according to Morgan Stanley.

Discretionary income is limited, as the 18 to 34-year-olds work to pay off student loans or gain their footing in the workplace. At the same time, fast-fashion retailers like H&M and Zara offer cutting-edge fashions for less. Paying a premium for a brand name is low on the list of priorities.

“Millennials love brands that are useful — and some of these brands have strong usefulness in terms of their design and functionality, and millennials also love things that are [a] good value, off the beaten path kind of stuff. Some of these brands have that going from them.” Jeff Fromm, president of millennial-focused marketing-research firm FutureCast and author of “Marketing to Millennials,” explained to Business Insider’s Mallory Schlossberg.

That puts traditional retailers like Abercrombie in a tough spot.

For years, Abercrombie banked on customers shopping there because they thought the brand name was a status symbol.